EQT, a Swedish buyout firm, is considering acquiring Kakaku.com, one of Japan’s top internet companies, according to Bloomberg, citing people familiar with the situation.
EQT has hired a financial adviser as it considers making an offer for the Tokyo-listed company. The talks are still in the early stages and may not result in a formal bid.
After the news broke, Kakaku’s shares jumped 24% in Tokyo trading, which is the maximum allowed in a single session. This pushed the company’s market value to about ¥519 billion, which is about $3.3 billion.
Earlier this week, EQT closed its latest Asia-focused buyout fund at $15.6 billion, making it the largest fund of its kind. Previously, it made a $2.7 billion bid to take Fujitec, an elevator and escalator maker, private. That deal set the pattern for EQT’s strategy of buying undervalued Japanese companies with governance issues and restructuring them to reduce their exposure to public-market pressures.
If EQT moves forward with a formal offer, it would probably use the same approach as with Fujitec: take the company private, ease short-term market pressures, restructure operations, invest in products and technology, and eventually relist or sell to another buyer.